D&L Industries Inc. said it is redeeming this week the first tranche (Series A) of the P5 billion bonds it raised in 2021 that was used to fund its Batangas plant.

The company said payment for the bonds the P3 billion portion of the bonds and all accrued and unpaid interests — will be made today, September 16, after its maturity date fell on a Saturday last week.

The three-year tenor bonds carried a coupon rate of 2.7885 percent when it was issued in September 2021.

The remaining P2 billion tranche (Series B) carried a coupon of 3.5962 percent.

Alvin Lao, D&L president, in August said the company has no plans to prepay the remaining tranche of the bond, citing the low interest rate the company is paying for the IOU.

The company is instead using its cash to pay down short-term debts, Lao added.

Lao, at the same time, downplayed any future plan for a long-term borrowing, citing the completion of the Batangas plant where the company poured significant amount of capital expenditure (capex) since it was constructed.

“It (capex) already peaked two years ago, so there’s no need for us to raise large amounts of cash. In the event that we do need additional cash, it’s quite easy to borrow from our lines with the banks,” he said.

Lao earlier said the newly inaugurated Batangas plant has turned profitable ahead of the projected two-year timeframe since 2023.